- I-DEV has led capital raises for Kenya’s hottest, fast growth firms including Twiga Foods, Big Square and many others.
- Today, it is estimated that Twiga has raised over $20M in capital, and it is rapidly revolutionizing Kenya’s food & produce sector.
- Business Insider SSA (BISSA) recently had a chat with Jason Spindler (JS), CEO & Managing director at I-DEV International to find out how he has been working with companies, iNGOs, and DFIs in over 40 countries across the globe to build leading, high impact businesses and a stronger private sector in emerging markets.
Since entering the space close to a decade ago, I-DEV International has not only revolutionized the Kenyan business scene but seriously upped the game as well. It can even be argued that no other company has better internalized ‘go big or go home’ mantra than I-DEV.
The firm has helped dozens of small and medium-sized businesses grow and increase their profitability by thinking and working smarter, faster and with more ambitious targets in mind.
I-DEV has led capital raises for Kenya’s hottest, fast growth firms including Twiga Foods, Big Square and many others. I-DEV is an active member of the East Africa Venture Capital Association (EAVCA), and frequent collaborator with EAVCA, Metta and other key ecosystem builders to emphasize that there are scalable and innovative business ripe for growth. For example, I-DEV’s Inside the C-Suite speaker series and podcast has showcased Cellulant CEO Ken Njoroge, Morne Deetleefs of Big Square, and Josh Ruxin and Chris Getonga of Goodlife Pharmacy.
I-DEV also advised Kenya’s mobile-based food delivery firm Twiga Foods, helping them to secure their seed round and put in place a strong growth plan for the first 24 months that led to a series of subsequent raises, and prestigious recognition by Google Launchpad, Endeavor Global and more. Today, it is estimated that Twiga has raised over $20M in capital, and it is rapidly revolutionizing Kenya’s food & produce sector.
“Twiga’s seed round at that time was the largest in East Africa to date, just under $2 million. It was a pretty groundbreaking deal for East Africa and it really changed the East African tech scene. It has been very interesting to watch what has been happening in the three years since that transaction went through,” says Jason Spindler, Managing Director of I-DEV International.
And by the look of things, 2019 will be even a busier year for I-DEV!
Business Insider SSA (BISSA) recently had a chat with Jason Spindler (JS), CEO & Managing director at I-DEV International to find out how it has been working with companies, iNGOs, and DFIs in over 40 countries across the globe to build leading, high impact businesses and a stronger private sector in emerging markets.
Jason, also Co-Founder of I-DEV, has 15+ years of experience advising large and small corporations on growth, management and financial strategy.
“The core of what we do is help businesses in emerging markets grow in scale. Our clients are generally businesses that range between $500,000 – $30 million in revenue so businesses that are in high growth stage. We provide support in two ways: one, strategy support where we help a business grow its top line and improve its bottom line, and two, access to capital and finance solutions,” says Jason.
Here is an excerpt of our conversation.
BISSA: So when was I-DEV international founded and when did it enter the Kenyan space?
JS: I-DEV has been around for 9 years now. Our global headquarters is in San Francisco, our Latin America headquarters is in Lima, Peru and Nairobi is our headquarters for Africa. We opened our Nairobi offices about five and a half years ago and then I moved here about four and a half years ago.
Since that time and since I-DEV was founded, we have worked with about 350 small and medium-size businesses in 45 countries around the world, including 15 in Sub-Saharan Africa. We have helped 40 businesses raise a total of $80 million in investment and growth capital. Today our average deal size is about $4.5 million in the capital that we help structure and facilitate, and now we are just about to kick off our own fund.
BISSA: Apart from helping Twiga Foods secure funding of $2 million seed capital and putting in place their growth plan for the first 24 months, what other local firms have you worked with and helped grow since you entered the Kenyan space?
JS: Another notable deal we have just closed this year is with Big Square, a fast casual dining chain that I’m sure you’ve seen in Nairobi. We helped Big Square raise $6.5 million to scale from 8 to 33 locations and potentially expand to other countries in East Africa.
We are now also helping Sir Henry’s, the well-known and iconic chain offering an exclusive collection of men's clothing and accessories. It’s a 50-year-old business and the son has just taken over. I-DEV has been brought onboard to help the business grow from 4 locations to 20 locations, and to really strengthen its position among the modern Kenyan consumer.
We are doing several other very interesting transactions that I can’t talk about just yet, but it will be in the public eye in the next few months if all goes well so keep an eye out.
BISSA: Okay, so what would you say is I-DEV’s market strategy and endgame for the Kenyan market?
JS: We are focused on building a robust business ecosystem and supporting the rising tide of ships- all the highly scalable businesses, but that still would benefit from some outside support! We are also launching our own fund and moving into direct investment. There are two funds that I am working on currently.
The first is specifically designed to work with a mix of high growth businesses in the East African market like Big Square, Sir Henry’s, Twiga and another company we are really excited about, Fuzu, which is an online job and career development platform. Companies like these can benefit from some additional hands on support. If we roll up our sleeves and step in to help them grow from a business development, partnerships and strategy perspective, as well as with the capital raise, we can help these companies achieve growth faster. This also addresses several gaps in the existing investment and SME landscape.
BISSA: I am sure though it has not been a walk in the park and you have hit some bumps and potholes here and there. What are some of the challenges I-DEV has experienced and continues to experience here in Kenya?
JS: To be honest, Kenya is a fairly good place to do business. There are small challenges here and there of course, just like any other market. Right now there are micro-economic challenges that are causing some issues and concern. Kenya’s population demographics versus its purchasing power is also not the best.
BISSA: You have probably heard of this expression that Africa is the future and the last frontier. Do you subscribe to that belief?
JS: I have looked at, studied and analyzed emerging markets for a long time. I lived and worked in India, lived in Latin America for a very long time, lived and worked in Singapore, I even looked at Eastern Europe, I was supposed to go to Eastern Europe, Russia in the early 2000s and do investment banking from there.
I think Africa is a very interesting market for growth. I think there are a lot of opportunities. I am very bullish on the tech sector and in particular in Kenya- the reason being that I see a lot of similarities between Kenya’s mobile ecosystem and Silicon Valley at the start of the internet era. It is not just mobile money and payments, it is all of the new business models that have been developed here based on the unlocking power of M-Pesa, the mobile money platform. To me, it’s like having the internet ten years before everyone else. Just look at how it has disrupted the banking industry.
M-Pesa is now essentially the largest banker in the country. Then you have off-grid energy companies such as M-Kopa that has raised a hundred million dollars plus, Fenix and Twiga – even all of these business models would not be possible or would not be nearly as effective and profitable without the unlocking power of mobile money.
So the underlying tech platform M-Pesa and its pervasiveness here in Kenya I think is really like the same kind of boom that we saw on Silicon Valley at the beginning of Internet era that led to the development of eBay, Paypal, Amazon and the development of dot.com companies. Those companies would not have been possible without the internet.
Just like we couldn’t tell in the early 90s where those online-based businesses would go, I don’t think we are really able to predict where the businesses that are driven by mobile money are going to go. But Kenya is a hub and where the strongest mobile money base began!
BISSA: So apart from agribusiness and tech, what other sectors in Africa show potential and which is I-DEV excited to get into?
JS: I think in Africa, every sector shows potential and is interesting. A good friend of mine tells the story of a CEO from a large company in Silicon Valley. He brings his friends to Africa, and when they get off the plane they say one of two things. They either say, “Holy shit, there is nothing here” and get back on the plane and go back home. Or they say “Holy shit, there is nothing here” and crack a big smile because they see the incredible and lucrative opportunities that poses. I think that summarizes Africa and I am much more of the latter.
This is the time and the place for incredible growth and new opportunity, including major leapfrogging and innovations to take Africa ahead of the curve. We released a report a while back called “#TIA: East” on the East Africa tech sector, and we used that name because I-DEV’s sees that this is about Tech innovation in Africa. THIS IS AFRICA, rife with opportunity. Not the derogatory reference of “this is Africa” where nothing works…and of course, it’s not just for tech, but general business model innovation, retail, food & beverage, energy, logistics and more.”
BISSA: Where do you see I-DEV say in the next 5 years?
JS: Let’s go 10 years. I hope to have a minimum of $500 million in our own funds and management. I see a lot of opportunities on the investor side, if you are willing to roll up your sleeves and get very active in helping to turn around and accel the growth of businesses.
The fund we’re raising now will help graduate more companies to beyond that early growth tipping point- and create more investable opportunities for the big VC and PE players targeting the $10M+ deals.